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Thread: How About Madoff?

  1. #1
    Custom Title Joesitz's Avatar
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    How About Madoff?

    A Ponzi blowout. All those wealthy peple and organizations lost quite a bit, although I am sure for most of them it is a nasty drop in the bucket.

    I'm sure he can be sent to prison, but what happens to the money he made?

  2. #2
    Forum translator Ptichka's Avatar
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    Quote Originally Posted by Joesitz View Post
    for most of them it is a nasty drop in the bucket.
    JEHT Foundation, dedicated to electoral reform and improving the criminal justice system - must close
    Lappin Charitable Foundation, covered the costs of trips to Israel for teenagers - must close
    Chais Family Foundation, involved with Jewish causes in Israel and Eastern Europe - must close
    Gift of Life Foundation, a Jewish bone marrow registry - must collect $1.8M or close
    City of Fairfield, CT - lost 15% of its pension fund!

    Other charities that have lost millions include Eli Weisel (solely invested with Madoff), Spielberg, Shapiro (Shapiro said he'll honor his current commitments including those to Brigham & Women hospital and to Brandeis University). All this has a trickle down effect - as those foundations have lost their money, on-the ground charities will have a very hard time. This has hit Boston especially hard; in fact, charities are saying this is worse for them than the stock market crash. The truth is that Jewish foundations have contributed disproportionally to charities of all kind (battered women shelters, education foundations, etc.), and the Jewish community has been hit the most by the scandal. So I would certainly challenge the "drop in the bucket" assertion.

  3. #3
    and... World Peace! Tonichelle's Avatar
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    what about Spielberg? I'm a little confused lol

  4. #4
    Custom Title Joesitz's Avatar
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    Ptichka - I said that tongue in cheek (and not nice of me) and it was pointed at the single investors, not the charities. Yet whomever, or whatever suffered from this game he was playing, and the SEC allowing him, just adds to the capitalistic push for being the richest person in the world. The question now, will he get off? He has enough money to buy the jury.

    Toni - I think Speilberg just made a bad investment and lost of couple of mil, if that. One has to diversify. I'm sure he has and many of the other single investors.

  5. #5
    Forum translator Ptichka's Avatar
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    With Spielberg - it's still unknown whether he lost money himself (I bet he did, but that's just speculation). However 70% (!) of dividend income and interest from his foundation was handled by Madoff.

    Joe, I know. But I purposely only listed charities/ foundations/ public sector.

    I don't think he'll get off. Unfortunately, the max he can get is 20 years (though at his age that should be a life sentence).

    What I am far more concerned about is what kind of regulation is needed to prevent this from happening in the future. Otherwise, noone in their right mind will chose to invest in the US anymore.

  6. #6
    and... World Peace! Tonichelle's Avatar
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    Ok, I was confused because I read charities and then you listed names and I was just not getting what you were saying, thanks to the both of you for clarifying...


    and Happy Birthday to Mr. Spielberg!

  7. #7
    Custom Title Joesitz's Avatar
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    Ptichka - 20 years is tough but I am sure he will be put in a minimum security prison. Now he made a personal fortune on this scheme, will some of this money be given back to the victims? There were some investors who did make a bundle in the early part of the deal so that will be his defence, I believe.

  8. #8
    Custom Title Mathman's Avatar
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    What is surprising to me is that people continue to fall for the same old shell game, over and over. Charles Ponzi died in 1949, but folks still seem to think that "investing" means getting something for nothing.

    Investing means risking your capital. The interest, capital gains, etc., that you realize from your investments is your reward for assuming this risk. The higher the promised rate of return, the riskier the investment. If some neo-Ponzi comes along and says you can double your money in six months, what he means is, you are very likely to lose your money in six months.

  9. #9
    Forum translator Ptichka's Avatar
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    MM, you're forgetting that Madoff outright lied. He fabricated data on his past performance. So, investors reasonably assumed that this was the guy with the demonstrated ability to make good investments. Too bad for them!

  10. #10
    Custom Title Joesitz's Avatar
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    If anyone is interested in the whole story, here is an excellent piece about the beginnings of Madoff through the present time. It's fascinating how he lured so many who should have known better. It also shows how it spread throughout the world. It reads like a Saga.

    http://www.nytimes.com/2008/12/20/bu..._r=1&th&emc=th

  11. #11
    Custom Title Mathman's Avatar
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    I see that one of the victims that lost money was the International Olympic Committee. I wonder if that will affect the Vancouver games in any way.

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